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Economy and Infrastructure

16.04.15

Devolution will bring maximum value for every taxpayer pound

With pressure on government expenditure unlikely to abate any time soon, devolution can help drive maximum value for every taxpayer pound, the head of Localis, the leading local government think tank, has stated.

Alex Thomson added that the devolution of power to councils and communities forming a prominent theme in each of the main political parties’ manifestos is a welcome development.

Yesterday, the Lib Dems launched their manifesto, which has become less a statement of priorities and more an opening gambit for coalition negotiations, with a promise to strengthen town hall powers.

Nick Clegg launched his party’s manifesto which includes plans to use the recommendations of the Independent Commission on Local Government Finance to reform council finances and find better ways to fund local services in England.

The manifesto also pledges to remove the requirement to hold a local referendum on a council tax rise of 2% or higher, and to devolve skills funding and back-to-work support to authorities and local enterprise partnerships.

In contrast, the Conservatives have promised to continue devolving power over transport, economic development and social to big cities, as long as they agree to take on a directly elected mayor.

David Cameron said if the Tories win the election his party will legislate to deliver the historic deal for Greater Manchester, which will devolve powers and budgets and lead to the creation of a directly elected mayor for Greater Manchester.

In Cambridgeshire, Greater Manchester and Cheshire East, a Conservative government will pilot allowing local councils to retain 100% of growth in business rates, “so they reap the benefit of decisions that boost growth locally”.

The Tories would also devolve further powers over skills spending and planning to the Mayor of London. And will deliver more bespoke Growth Deals with local councils, where locally supported, and back Local Enterprise Partnerships to promote jobs and growth.

Labour’s manifesto was mostly a confirmation of older announcements, but the party has pledged to devolve control of £30bn to England’s cities and counties and to allow councils to retain 100% of their additional business rate take.

Along with the funding, new local powers over economic development, skills, employment, housing, and business support will be granted. This will include control over local transport systems so that in future, local bodies can integrate trains, buses, trams and cycling into a single network.

Ed Miliband’s party claims “fair funding” will be restored across England, alongside longer term multi-year budgets, so that local authorities can plan ahead on the basis of need in their area and protect vital services.

On top of this, an English Regional Cabinet Committee, chaired by the prime minister, would be convened regularly, attended by the relevant secretaries of state and leaders of England’s major city and county regions.

“In return for greater devolution of funding and responsibility, we will establish local Public Accounts Committees, so that every pound spent by local bodies creates value for money for local taxpayers,” said Labour.

Thomson stated that recent history makes it abundantly clear that Westminster doesn’t have all the answers. “Rather, the closer decisions are made to the people they effect, the better those decisions are,” he said. “It is evident that putting power in the hands of local people will be a key feature of the next parliament, whoever is in government.”

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editor's comment

Devolution, restructuring and widespread service reform: from a journalist’s perspective, it’s never been a more exciting time to report on the public sector. That’s why I could not be more thrilled to be taking over the reins at PSE at this key juncture.
There could not be a feature that more perfectly encapsulates this feeling of imminent change than the article James Palmer, mayor of Cambridgeshire and Peterborough, has penned for us on p28. In it, he highlights...read more >